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97-1308_ Council File ,# q� � j �(�� Green Sheet # `� `� ( RESOLUTION SAINT PA��"� '*'��_.,_ ' � ��_ Presented By Referred To Committee: Date WHEREAS: 1. The Port Authority of the City of Saint Paul {the "Authority") has given its approval to the issuance af up to 52,205,000 of its Variable Rate Demand Industrial Development Revenue Bonds (Bro-Tex Project) Series 1997A and Series 1997B (co{{ectively the "Bonds"}, for the purposes of (a) refunding both the Port Authority's 51,065,000 Industrial Development Revenue Refunding Bonds iFiampden Building Project� and the Port Authority's 5850,000 industrial Development Revenue Note of 1984 (Bro-Tex, inc. Projectl, and (b) reimbursing the Borrower for capital costs incurred in connection with an expansion of the existing manufacturing facility owned and operated by Bro-Tex Co., lnc. in the City of Saint Paul, Minnesota (the "City"); and 2. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue bonds authorized by the Authority shall be issued only with the consent of the City Council of the City of Saint Pauf, by resolution adopted in accordance with law; and 3. To meet the requirements of state law, the Port Authority has requested that the City Council gives its requisite approval to the issuance of the proposed Bonds by the Port Authority, subject to final approval of the details of said Bonds by the Port Authority. ` • q7-1308' NOW, THEREFORE, BE IT RESOLVED by the Council ofi the City of Saint Paul that, in accordance with Laws of Minnesota 1976, Chapter 234, the City Council hereby approves the issuance of the aforesaid Sonds by the Port Authority for the purposes described in the Port Authority resolution adopted Qctober 28, 1997, the exact details of which, including but not limited to, provisions relating to maturities, interest rates, discount, redemption, and the issuance of additional bonds are to be determined by the Port Authority, and the City Council hereby authorizes the issuance of any additional bonds (including refunding bonds) by the Port Authority found by the Port Authority to be necessary for carrying out the purposes for which the aforedescribed Bonds are issued. Adopted: October 29, 1997 3588843.0] Requeste Depamnent of: ��^� /� vG� ��l��.e'�L� � Adoption Certified by Council Secretarv � App� � Form Appr ved by City Attomey By�L'"^ � � °— �p- T7 Appr ved by 'ssion to�cil By: � Adopted by Council: Date �� _ aq \g9;� Saint Paul Port Authority Peter M. Klein , 1997 (CONSENT AGENT) I GREEN SHEET � DEPARTMENTOIRECTOR � CRY ATiORNEY FOfl . � BUDGET DIflECTOR ■ � MAYOR IOR ASSISTANi) N� �t� -f�og- _13116 — wmawa'r� —� CliY CAUNCII C17Y 0.ERK FW. & MGT. SERVICES �IR. ax exempt re or the refuni Bro-Tex facil: _al costs incu TOTAL # OF S PAGES (CLIP ALL LOCATION F SIGNATURE) �crioNr�QUesrEO:Ap roval of the issuance of an ag roximate $2,205,000 condui and conduit �axable bond issue to Ro er A. �reenber ; Bro-Tex Co. Inc ofbonds previously issued by the Por� Authority to �inance the origina and the Hampden Building, and for reimbursement to the company for cap in connection with a 37,000 Sq, Ft. expansion to the Bro-Tex £acility. RECOMMENDATIONS: ApprovB fA) or Reject (R) _ PLANNING COMMI5510N _ qVIL SERVICE COMMVSSION _C16COMMITTEE A Port Authoritv _ �, _ Bd. of Co�. _DISTRICTGOURT _ SUPPORTS WHICH COUNGIL OBJECTIYE? INITIATING PROBLEM, ISSUE, OPPORTUNITY (Wtw, PERSONAL SERVICE CONTRACTS MUST ANSWER THE FOLLOWING QUESTIONS: t. Has Nis OersonNirm ever worked under a contract for ihis department? YES NO 2. Has this personlEirm ever been a city employee? YES NO 3. Does this personifirtn possess a skiil not normally possessed by any curcent ctty employee? YES NO Explain all yes answers on separate sheet and attaeh to green sheet The refunding bond issue will enable Bro-Tex, Inc, to expand its present capacity. As a result, approximately 22 new �obs will be created in the first two years of its expanded facility. ��c��a ��''�"'1 �`i�i'a��3' None C� S 2 t� 3��7 he new jobs will not be created . AMOUNTOFTRANSACTION $ 2 2QS� OOO CaSVpEVENUE BUDGETED (CIRCLE ONE) YES NO Gonduit tax exempt refunding NGSOURCE and conduit taxable bond issue ACTIVITYNUMBER IAL IHFORMATION. (EXPLAIN) �e. 91-13ot� FAX (612) 223-5198 PORT AUTHORITY OF THE C(TY OF SAINt PAUL TOLI R2EE (8�) 328-8417 1900 LA(VDMARK TOWERS • 345 ST. PETER 5TREET • ST. PAUL MN 55102-1661 • PHONE (612) 224-5686 October 17, 1997 Ms. Pam Wheelock, Director Planning & Economic Development Department 1300 Gity Hall Annex 25 West Fourth Streef Saint Paul, Minnesota 55102 RE: $2,205,000 CONDUIT TAX EXEMPT REFUNDING AND CONDLlIT TAXABLE BOND ISSU ROGER H. GREENBERG - BRO-TEX CO., INC. Dear Ms.� ck`:��.� / We submit for your review and referraf to the office of the Mayor, City Council, and City Attorney's office, details pertaining to the issuance of a conduit tax-exempt refunding and conduit taxable bond issue in the approximate amount of $2,205,000. The tax exempt portion of this bond issue wi11 be used to refund the bonds previousfy issued by the Port Authority to finance the originaf Bro-Tex facility and the Hampden Building, and the taxable portion of this bond issue will be used to reimburse the company for capital costs incurred in connection with a 37,000 Sq. Ft. expansion to the Bro-Tex facility. The availability of tax- exempt financing for the refunding will enable Bro-Tex Co., Inc. to expand its present capacity. In addition to the staff memorandum, we are attaching a draft copy of the proposed City Council Resolution and a copy of the Resolution authorizing the sale of the revenue bond issue in the amount of $2,205,000 that wii{ be considered by the Port Authority's Board on October 28, 1997. City Council action will be required after the Port Authority's Board meeting of Oetober 28, 1997. Your expeditious handling of this matter wiN be appreciated. Sincerely, �� Kenneth R. Johnson President KRJ:s}s Attachment cc: Mayor Coleman 9:PmMbrot�W+.tloc SAINT PAUL PoRT AUTHORITY � .•� . � TO: CREDIT COMMiTTEE DATE: Oct. 17, 1997 {October 21, 1997 ftegular Credit Committee Meeting) FROM: Peter M. Klein �L'� torrie J. Louder Kenneth R. Johnson SUBJECT: ROGER H. GREENSERG - SRO-TEX CO., INC. AUTHORIZATION FOR AN APPROXIMATE $2,205,000 CONDUtT TAX EXEMPT REFUNDING AND CONDUlT TAXABLE BOND iSSUE °I�-13otr Change from Preliminary Resolution In August, the Board of Commissioners preliminarify approved the issuance of $1,760,000 of conduit bonds for Mr. Greenberg. The increase in the amount of bonds from $1,760,000 to $2,205,000 is due to Mr. Greenberg's request to also refinance a 1984 bond issue, which remains outstanding in the amount of $490,000. PMK:jmo SAINT PAUL l'•' ' �� .•� . � TO: CREDIT COMM(TTEE DAT'E: Qct. 17, 1997 (October 21, 1997 Regular Credit Commiftee Meeting) FROM: Peter M. Klein l��'` lorrie J. Lauder Kenneth R. Johnson ° I � -130�' SUBJEC"T: ROGER H. GREENBERG - SRO-TEX CO., fNC. AUTHORIZATION FOR AN APPROXIMATE $2,205,000 CONDUIT TAX EXEMPT REFUNDING AND CONDUIT TAXABLE BOND ISSUE ACTfON REQUESTED: Approvai of final resofution authorizing the issuance of an approximate $2,205,000 conduit bond issue to Roger H. Greenberg. PROJECT SUMMARY: Estimated Amount:: Type: Term: Issuer: Borrower: Trustee: Letter of Credit Bank: Placement Agents: Remarketing Agent: Borrower's Counsel: Placement Agents' Counsel: Letter of Credit Bank Counsel: Bond Counsel: $2,205,000 - Series A - $1,405,000 Tax-Exempt Refunding - Series B - $800,000 Taxable Variable Rate Demand Industria! Development Revenue Bonds 14 Years for Tax-ExempU20 Years for Taxable Port Authority of the City of Saint Paul Roger H. Greenberg To Se Determined U.S. Bank National Association Miller & Schroeder Financial, Inc. Piper Jaffray, fnc. FBS Investment Services, Inc. Piper Jaffrey, lnc. Winthrop & Weinstine Oppenheimer, Wolff & Donneliy Briggs and Morgan Leonard, Street & Deinard October 17, 1997 Page -2- BACKGROUND: �C� -1308' The Bo�rower. Bro-Tex Co., fnc. processes synthetic fibers for the automotive industry and manufactures and converts paper and cfoth wipers and is currentiy located at 800 Hampden Avenue, Saint Paul, in a facility originaiiy financed by the issuance ofi a tax-exempt Port Authorify conduit bond in 1984. ln 1996, the company acquired from Hampden Building Limited Partnership the bu+lding located on the ad}'acent parcel of land, to provide space for expansion. The Nampden Building had originally been financed by the issuance of a tax-exempt Port Authority conduit bond in 1984 which was refunded in 1990. This debt was assumed by Roger Greenberg as part of the acquisition. The company has now compieted their expansion, and has installed in its expanded space a new line of manufacturing equipment, which was financed with a $2,000,000 Port Authority conduit bond issue in April of this year. The Bands: The Bonds will be issued in the approximate principal amount of $2,205,000 and wiil bear interest at a variabie rate estabiished weekly by the Remarketing Agent. The maximum interest rate is 10% for the tax-exempt bond series and 18°lo for the taxable bond series. The Project: The proceeds of the Bonds will be loaned to the Borrower, and the $1,405,000 tax- exempt portion of this bond issue wiN be used to refund the Bonds previously issued by the Port Authority to finance the origina{ Bro-Tex facility and the Hampden Building. Tfie Borrower has represented that the owner of the prior bonds has approved this refunding. The $800,000 taxabie portion of this bond issue wili be used to reimburse the company for costs on ihe 37,000 square fooi expansion. The availability of tax-exempt financing for the refunding will enable Bro-Tex Co., Inc. to expand its present capacity. As a result, new jobs will also be created to support the revenue and production increases. Em�lo�ment {mpact: This project is important because it retains this company and its jobs in Saint Paul. Under the Port Authority's Workforce and Empioyment Agreement, Bro-Tex, Inc. befieves it will create 22 new jobs in the first two years of operations of its expanded facility, as a result of its increased capacity. Also, as a result of the consfructian of the new facility, Bro-7ex, 4nc. has estimated that there wiil be an annual payroll increase of over $400,000 per year when fully operational. October 17,1997 Page -3- Number of Jobs Cunent positions New positions within two years TOTAL 90 22 � Annuaf Waaes $2,0OO,OQ� 400.000 $2.400.000 The tetter of Credit Bank: The initial letter of credit will be provided by U.S. Bank Nationai Association. �stimated Sources and Uses of Funds: Sources of Funds: Bond Proceeds Estimated Borrower Funds Total Sources of Funds Uses of Funds: Refu�ding of 1984 Bond Issue Refunding of 1990 Sond Issue Reimburse Capital Expenditures for Expansion Estimated Costs of issuance Totai Uses of Funds SECURITY FOR THE BONDS: $2,205,00a 85.000 $2,290,000 $ 490,040 900,00� 800,000 100.000 $ 2,290,000 �1-1�� $` Conduit Financing The bonds will be conduit financing of the Authority and wiil not constitute or give rise to a{iabiiity of the Authority, the City of Saint Paui or the State of Minnesota or a charge against their generai credit or taxing powers. No bondholder wifl have the right to demand payment of the bonds out of any funds to be raised from taxation or trom any revenue sources other than those expressly pledged to payment of the bonds pursuant to the indenture. This includes the amounts drawn on the letter of credit and amounts payable by the borrower under the loan agreement. The Port Authority wi11 receive fees in the amount of 1/8th of a point ($2,756.25) at inception and 118th of a point on the outstanding balance, annually, for the life of fhe bonds. October 17,1997 Page -4- �17-130�' Loan AgreemenY Under the indenture, the Authoriry has pledged its interest in the loan agreement to the trustee to secure the bonds. The trustee is authorized fo exercise the rights of the Aufhority and fo enforce the obligations of the borrower under the loan agreement Let[er of Credit: Payment of the principal amount and purchase price of the bonds, and up to approximately 50 days interest thereon (measured at the 10% maximum rate for the tax-exempt series and 18% for the taxable series) wili be secured initialfy by the initiai letter of credit or, under cerfain circumstances a substitute letter of credit. The trustee is required to present a draft under the letter of credit to pay principa! and interest when due on the bonds. The bonds are offered primarily on the basis of the financial strength of the bank and not on the basis of the financial strength of the borrower. The letter of credit wifl have an initial term of one year, and will be renewable annually thereafter, uniess the bank provides at least 45 days notice that it wili not renew. If the letter of credit is not renewed or replaced, the bonds will be subject to mandatory tender, and the trustee +s instructed to draw on the letter of credit, before it expires, to purchase the bonds, which wou{d then remain outstanding and be he{d by the bank and possibly remarketed without a letter of credit with proper disclosure DISCLOSURE: Port Authority Commissioners, by S.E.C. rules, are obligated to disclose any risks or faets you may be aware of that would affect the probabi{ity of repayment of these bonds. RECOMMENDATION: Recommend approval of the above-referenced Resolution. PMK:jmo o�amk��axa.a� -s �'1-1 � 08' Resolution No. RESOLUTION OF THE PORT AUTHORI'f'Y f3F THE CITY OF SAINT AUL WHEREAS: 1. It has been proposed that the Port Authority of the City of Saint Pau{ {the "Port Authority") issue its Variable Rate Demand Industrial Deveiopment Revenue Refunding Bonds (Bro-Tex Project) 5eries 1997A (the °Series A Bonds") and its Taxable Variable Rate Demand Industrial Development Revenue Bonds SBro-Tex Project) Series 1997B Sthe "Series B Bonds" and together with the Series A Bonds, the "Bonds") in an aggregate principal amount not to exceed 52,205,000], and that the proceeds ofi such Bonds be loaned to Roger H. Greenberg, an individual resident of the State of Minnesota (the "Borrower") for the purposes of {a) refunding the Port Authority's 51,065,000 Industrial Deve{opment Revenue Refunding Bonds (Hampden Buiiding Project) (the "1990 Bonds"} and 5850,�00 Industrial Development Revenue Note ofi 1984 (Bro-Tex, Inc. Project) (the "1984 Note", and together with the 1990 Bonds, the "Prior Bonds"►, and {b) reimbursing the Borrower for capital costs incurred in connection with an expansion of the existing manufacturing facility owned and operated by Bro-Tex, fnc. in the City of Saint Paui, Minnesota (the "City") (the activities described in clauses (a) and (b) shall be collectively referred to herein as the "Project"). , 2. The above-described proposal has changed since August 26, 1997, the date the Port Authority gave its preliminary approval to the issuance of the Bonds, in that the Borrower has asked the Port Authority to additionally refund 1984 Note, thereby causing the total aggregate amount of the Bonds to increase from approximately 51,76�,000 to an amount not to exceed 52,205,000. 3. The Authority desires to facilitate the selective development of the City of Saint Paul and the metro east community, to retain and improve its tax base and to help it provide the range ofi services and empfoyment opportunities required by its population, and the Project will assist in achieving that objective by increasing the assessed valuation of the metro east community; helping to maintain a positive relationship between assessed valuation and debt; and enhancing the image and reputation of the metro east community. 4. The Project wiil result in additional employment opportunities in the City of Saint Paul and the metro east community. 5. The Authority has been advised by representatives of the Company that fong term conventional, commerciai financing to pay the capitai cost of the Project is available only on a limited basis and at such high costs of borrowing that the ]5888A3.01 �I� -43�� economic feasibility of the Project wouid be significantly reduced, and that it has been acting to date in anticipation that the Authority would favorably consider this financing proposal. 6. The Authority's Credit Committee and Board have previousfy adopted their Resolutions Nos. 26 and 3648, respectively, giving preliminary approval to the proposed issuance of revenue bonds. 7. The Bonds will be issued and secured by the terms ofi an Indentu�e of Trust (the "lndenture") between the Port Authority and in , Minnesota (the "Trustee") and will be payable primarily from draws made on an irrevocabie fetter of credit issued by U.S. Bank National Association (the "Credit Enhancer") pursuant to a Letter of Credit and Reimbursement Agreement to be dated as of November , 7 997 between the Borrower and the Credit Enhancer (the "Letter of Credit Agreement"). 8. The Borrower and the Port Authority will also enter into a Loan Agreement (the "Loan Agreement") in which the Borrower wil! agree to maintain the Letter of Credit and make all payments due either to the Credit Enhancer or on account of the Bonds. 9. The Bonds and the interest on the Bonds shall Be payable solely from the revenue pledged therefor and the Bonds shall not constitute a debt of the Port Authority within the meaning of any constitutional or statutory limitation of indebtedness, nor shall the Bonds constitute nor give rise to a pecuniary Iiability of the Port Authority or the City or a charge against their general credit or taxing powers and shall not constitute a charge, lien or encumbrance, lega! or equitabie, upon any property of the Port Authority or the City other than their interest in said Project. 10. it is intended that interest on the Series A Bonds be excluded from gross income of the holders thereof for federal i�come tax purposes. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMiSS10NERS OF THE PORT AUTHORITY OF THE CITY OF SAINT PAUL, AS FOLLOWS: 1. On the basis of information available to the Port Authority it appears, and the Port Authority hereby finds, that: the expansion of the manufacturing facility to be financed with the Series B Bonds consiitutes properties, used or usefiui in connection with one or more revenue producing enterprises engaged in any business within the meaning of Minnesota Statutes, Sections 469.152 to 469.165 (the "Act"), and that the Port Authority is authorized to issue revenue bonds to refund the Prior Bonds pursuant to the Act; the Project furthers the purposes stated in the Act; and it is in the best interests of the port district and the people of the City of Saint Paul and in furtherance of the general plan of development to assist the Borrower in financing the Project. 1588&l3,01 9�-i'�og� 2. For the purpose of financing the Project, and paying certain costs of issuance and other axpenses in connection with the issuance of the Sonds, tfie Port Authority hereby authorizes the issuance, safe and delivery of the Bonds in an aggregate principal amount not to exceed 52,205,OOQ, for the purposes set forth in the first whereas clause above. Each Series of Bonds shall be in such principal amounts as shall be determined by the President of the Port Authority and Bond Counsel, provided that the aggregate principal amount of Series A Bonds shalf not exceed � 1,405,000. The Bonds shall bear interest at such rates, shall be numbered, shall be dated, shal{ mature, shal{ be subject to redemption prior to maturity, and sha11 be in such form and have such other details and provisions as may be prescribed in the Indenture, suhstantially in the form now on tile in the offices of the Port Authority. 3. Neither the Bonds, nor the interest thereon, shall constitute an indebtedness of the Port Authority or the City within the meaning of any constitutional or statutory debt limitation; nor shall they constitute or give rise to a pecuniary liabifity of the City, the Port Authority or a charge against their general taxing powers and neither the fufl faith and credit nor the general taxing powers of the C+ty or the Port Authority is pledged to the payment of the Bonds or interest tfiereon. 4. Forms of A�thority for review delivery of the Bonds: the following documents have been submitted to the Port andlor approval in connection witfi the sale, issuance and a. the Bond Placement Agreement to be entered into between the Port Authority, the Borrower and Miller & Schroeder Financial, Inc., Piper Jaffray Inc. and U.S. Bancorp Investments, Inc. (coilectively, the °Placement Agent") ithe "Bond Placement Agreement"); b. the Indenture; c. the Loan Agreement dated as of November 1, 1997 to be entered into between the Port Authority and the Borrower; d. the Bonds; e: the Preliminary Official Statement to be used in marketing the Bonds (the "Officiai StatemenY'}; f. the Remarketing Agreement dated as of November 1, 1997 to be entered into by and between Piper Jaffray Inc. (the "Remarketing AgenY'} and the Borrower ithe "Remarketing Agreement"�; and g. the tetter of Credit Agreement, including a form of the Letter of Credit 1588843.01 9'1-13 08' (coilectively, the "Documents"). 5. It is hereby found, determined and declared that: a. The issuance and sale of the Bonds, the execution and delivery by the Port Authority of the Documents {to the extent applicable) and the performance of all covenants and agreements of the Port Authority contained in the Documents, and of aff other acts and things required under the Constitution and laws of the State of Minnesota to make the Documents and the Bonds valid and binding obligations of the Port Authority in accordance with their terms, are authorized by Minnesota Statutes, Sections 469.152 through 469.165, as amended (the "Act"); b. It is desirable that the Bonds be issued by the Port Authority upon the general terms set forth in the Documents, as applicable; c. Under the provisions of and as provided in the Documents, the Bonds are not to be payable from or a charge upon any funds other than the revenues pledged to the payment thereof; no holder of the Bonds shaii ever have the right to compel any exercise by the City or the Port Authority of its taxing powers to pay the Bonds or the interest or premium thereon, or to enforce payment thereot against any property of the City or the Port Authority except tfie interests of the Port Authority and the City which have been pledged to the Trustee under the Indenture; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City or the Port Author+ty except the interests of the Port Authority and the City which have been pledged to the Trustee under the Indenture; the Bonds shall each recite that they are issued without morai obligation on the part of the State or its political subdivisions, and that the Bonds, inciuding interest thereon, are payable sofely firom the revenues pledged to the payment thereof; and the Bonds shall not constitute a debt of the City or the Port Authority within the meaning of any constitutional or statutory limitation. 6. The forms of the Documents and exhibits thereto are approved substantiafly in the forms submitted and on file in the offices of Port Authority, with such subsequent changes as may be approved by Port Authority staff and Bond Counsel as contemplated by paragraph 8. The Chair and Secretary of the Port Authority, or such other officer as may be appropriate in the absence of either the Chair or Secretary, are hereby authorized and directed to execute the Documents {to the extent the Port Authority is a party thereto) in substantially the forms subm+tted, as modified pursuant to paragraph 8, and any other documents and certificates which in the opinion of Port Authority staff and Bond Counsei are necessary to the transaction herein described The execution of any instrument by the appropriate officer or officers of the Port Authority herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. The execution of any documents necessary for the transaction herein described by 1588843.01 °1�-130� individuals who were at the time of execution thereof the authorized officers of the Port Authority sha!( bind the Port Authority, notwithstanding that such individuals or any of them has ceased to hold such off+ce or offices prior to the authentication and delivery of the Bonds. Copies of all of the documents necessary to the transaction described shal{ be delivered, filed and recorded as provided herein and in the Indenture. 7. The President and other officers of the Port Authority are authorized and directed to prepare and furnish to the Piacement Agent and Bond Counsel certified copies of proceedings and records ofi the Port Authority relating to the issuance of the Bonds and other transactions herein contempiated, and sueh other affidavits and certificates as may be required to show the facts relating to the legality of the Bonds and the other transactions herein contemplated as such facts appear from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the Port Authority as to the truth of all statements contained therein. 8. The approval hereby given to the various Documents referred to above includes approvaf of such additional details therein as may be necessary and appropriate, and such modifications thereof, deietions therefrom and additions thereto as may be necessary and appropriate and approved by the Port Authority's President and Chief Financial Officer; and inctudes approval of, among other things: a, The establishment of the final principal amount of the Bonds and the interest rate to be borne thereby for the initial period; rovi that the maximum aggregate principai amount of the Series A Bonds shalf not exceed 51,405,000, and the maximum aggregate principal amount of the Series A Bonds and the Series B Bonds together shall not exceed �a2,205,000; and provided further that the maximum interest rate on the Series A Bonds shall not exceed 10% per an�um, and the maximum interest rate on the Series B Bonds shall not exceed 18% per annum; b. The establishment of the maturity schedule and call provisions to be applicable to the Bonds; and c. Such related instruments as may be required to satisfy the conditions of any purchaser of the Sonds. 9. The Port Authority hereby consents to the distribution of the Official Statement, as such Official Statement is fiinalized with the participation of Port Authority staffi and Bond Counsel. The proposal of the Placement Agent to place the Bonds upon the terms and conditions set forth in the Bond Placement Agreement is hereby found and determined to 6e reasonable and is hereby accepted. 10. The authority to approve, execute and deliver future amendments to financing documents entered into by the Port Authority in connection with the tssssas.at q� - ��oa' issuance of the Bonds and the other transactions herein contemplated, is hereby delegated to the President ofi the Port Authority, provided that: ia) such amendments do not require the consent ofi the holders of the Bonds; {b) such amendments do not materially adversely affect the interests of the Port Authority as the issuer of the Bonds; (c) such amendments do not contravene or violate any policy of the Port Authority; and {d) such amendments are acceptable in form and substance to Bond Counsel. The execution of any instrument by the President of the Port Authority shall be conciusive evidence of the approval of such instruments in accordance with the terms hereof. 11. No covenant, stipulation, ob{igation or agreement contained herein or in the Documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the Board of Commissioners of the Port Authority, or any officer, agent or employee of the Port Authority in that persons individual capacity, and neither the Board of Commissioners nor any officer executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. Adopted: October 28, 1997 PORT AUTHORITY OF THE CfTY OF SAINT PAUL By Its Chair ATTEST: By Its Secretary 1588&43.01 _ Council File ,# q� � j �(�� Green Sheet # `� `� ( RESOLUTION SAINT PA��"� '*'��_.,_ ' � ��_ Presented By Referred To Committee: Date WHEREAS: 1. The Port Authority of the City of Saint Paul {the "Authority") has given its approval to the issuance af up to 52,205,000 of its Variable Rate Demand Industrial Development Revenue Bonds (Bro-Tex Project) Series 1997A and Series 1997B (co{{ectively the "Bonds"}, for the purposes of (a) refunding both the Port Authority's 51,065,000 Industrial Development Revenue Refunding Bonds iFiampden Building Project� and the Port Authority's 5850,000 industrial Development Revenue Note of 1984 (Bro-Tex, inc. Projectl, and (b) reimbursing the Borrower for capital costs incurred in connection with an expansion of the existing manufacturing facility owned and operated by Bro-Tex Co., lnc. in the City of Saint Paul, Minnesota (the "City"); and 2. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue bonds authorized by the Authority shall be issued only with the consent of the City Council of the City of Saint Pauf, by resolution adopted in accordance with law; and 3. To meet the requirements of state law, the Port Authority has requested that the City Council gives its requisite approval to the issuance of the proposed Bonds by the Port Authority, subject to final approval of the details of said Bonds by the Port Authority. ` • q7-1308' NOW, THEREFORE, BE IT RESOLVED by the Council ofi the City of Saint Paul that, in accordance with Laws of Minnesota 1976, Chapter 234, the City Council hereby approves the issuance of the aforesaid Sonds by the Port Authority for the purposes described in the Port Authority resolution adopted Qctober 28, 1997, the exact details of which, including but not limited to, provisions relating to maturities, interest rates, discount, redemption, and the issuance of additional bonds are to be determined by the Port Authority, and the City Council hereby authorizes the issuance of any additional bonds (including refunding bonds) by the Port Authority found by the Port Authority to be necessary for carrying out the purposes for which the aforedescribed Bonds are issued. Adopted: October 29, 1997 3588843.0] Requeste Depamnent of: ��^� /� vG� ��l��.e'�L� � Adoption Certified by Council Secretarv � App� � Form Appr ved by City Attomey By�L'"^ � � °— �p- T7 Appr ved by 'ssion to�cil By: � Adopted by Council: Date �� _ aq \g9;� Saint Paul Port Authority Peter M. Klein , 1997 (CONSENT AGENT) I GREEN SHEET � DEPARTMENTOIRECTOR � CRY ATiORNEY FOfl . � BUDGET DIflECTOR ■ � MAYOR IOR ASSISTANi) N� �t� -f�og- _13116 — wmawa'r� —� CliY CAUNCII C17Y 0.ERK FW. & MGT. SERVICES �IR. ax exempt re or the refuni Bro-Tex facil: _al costs incu TOTAL # OF S PAGES (CLIP ALL LOCATION F SIGNATURE) �crioNr�QUesrEO:Ap roval of the issuance of an ag roximate $2,205,000 condui and conduit �axable bond issue to Ro er A. �reenber ; Bro-Tex Co. Inc ofbonds previously issued by the Por� Authority to �inance the origina and the Hampden Building, and for reimbursement to the company for cap in connection with a 37,000 Sq, Ft. expansion to the Bro-Tex £acility. RECOMMENDATIONS: ApprovB fA) or Reject (R) _ PLANNING COMMI5510N _ qVIL SERVICE COMMVSSION _C16COMMITTEE A Port Authoritv _ �, _ Bd. of Co�. _DISTRICTGOURT _ SUPPORTS WHICH COUNGIL OBJECTIYE? INITIATING PROBLEM, ISSUE, OPPORTUNITY (Wtw, PERSONAL SERVICE CONTRACTS MUST ANSWER THE FOLLOWING QUESTIONS: t. Has Nis OersonNirm ever worked under a contract for ihis department? YES NO 2. Has this personlEirm ever been a city employee? YES NO 3. Does this personifirtn possess a skiil not normally possessed by any curcent ctty employee? YES NO Explain all yes answers on separate sheet and attaeh to green sheet The refunding bond issue will enable Bro-Tex, Inc, to expand its present capacity. As a result, approximately 22 new �obs will be created in the first two years of its expanded facility. ��c��a ��''�"'1 �`i�i'a��3' None C� S 2 t� 3��7 he new jobs will not be created . AMOUNTOFTRANSACTION $ 2 2QS� OOO CaSVpEVENUE BUDGETED (CIRCLE ONE) YES NO Gonduit tax exempt refunding NGSOURCE and conduit taxable bond issue ACTIVITYNUMBER IAL IHFORMATION. (EXPLAIN) �e. 91-13ot� FAX (612) 223-5198 PORT AUTHORITY OF THE C(TY OF SAINt PAUL TOLI R2EE (8�) 328-8417 1900 LA(VDMARK TOWERS • 345 ST. PETER 5TREET • ST. PAUL MN 55102-1661 • PHONE (612) 224-5686 October 17, 1997 Ms. Pam Wheelock, Director Planning & Economic Development Department 1300 Gity Hall Annex 25 West Fourth Streef Saint Paul, Minnesota 55102 RE: $2,205,000 CONDUIT TAX EXEMPT REFUNDING AND CONDLlIT TAXABLE BOND ISSU ROGER H. GREENBERG - BRO-TEX CO., INC. Dear Ms.� ck`:��.� / We submit for your review and referraf to the office of the Mayor, City Council, and City Attorney's office, details pertaining to the issuance of a conduit tax-exempt refunding and conduit taxable bond issue in the approximate amount of $2,205,000. The tax exempt portion of this bond issue wi11 be used to refund the bonds previousfy issued by the Port Authority to finance the originaf Bro-Tex facility and the Hampden Building, and the taxable portion of this bond issue will be used to reimburse the company for capital costs incurred in connection with a 37,000 Sq. Ft. expansion to the Bro-Tex facility. The availability of tax- exempt financing for the refunding will enable Bro-Tex Co., Inc. to expand its present capacity. In addition to the staff memorandum, we are attaching a draft copy of the proposed City Council Resolution and a copy of the Resolution authorizing the sale of the revenue bond issue in the amount of $2,205,000 that wii{ be considered by the Port Authority's Board on October 28, 1997. City Council action will be required after the Port Authority's Board meeting of Oetober 28, 1997. Your expeditious handling of this matter wiN be appreciated. Sincerely, �� Kenneth R. Johnson President KRJ:s}s Attachment cc: Mayor Coleman 9:PmMbrot�W+.tloc SAINT PAUL PoRT AUTHORITY � .•� . � TO: CREDIT COMMiTTEE DATE: Oct. 17, 1997 {October 21, 1997 ftegular Credit Committee Meeting) FROM: Peter M. Klein �L'� torrie J. Louder Kenneth R. Johnson SUBJECT: ROGER H. GREENSERG - SRO-TEX CO., INC. AUTHORIZATION FOR AN APPROXIMATE $2,205,000 CONDUtT TAX EXEMPT REFUNDING AND CONDUlT TAXABLE BOND iSSUE °I�-13otr Change from Preliminary Resolution In August, the Board of Commissioners preliminarify approved the issuance of $1,760,000 of conduit bonds for Mr. Greenberg. The increase in the amount of bonds from $1,760,000 to $2,205,000 is due to Mr. Greenberg's request to also refinance a 1984 bond issue, which remains outstanding in the amount of $490,000. PMK:jmo SAINT PAUL l'•' ' �� .•� . � TO: CREDIT COMM(TTEE DAT'E: Qct. 17, 1997 (October 21, 1997 Regular Credit Commiftee Meeting) FROM: Peter M. Klein l��'` lorrie J. Lauder Kenneth R. Johnson ° I � -130�' SUBJEC"T: ROGER H. GREENBERG - SRO-TEX CO., fNC. AUTHORIZATION FOR AN APPROXIMATE $2,205,000 CONDUIT TAX EXEMPT REFUNDING AND CONDUIT TAXABLE BOND ISSUE ACTfON REQUESTED: Approvai of final resofution authorizing the issuance of an approximate $2,205,000 conduit bond issue to Roger H. Greenberg. PROJECT SUMMARY: Estimated Amount:: Type: Term: Issuer: Borrower: Trustee: Letter of Credit Bank: Placement Agents: Remarketing Agent: Borrower's Counsel: Placement Agents' Counsel: Letter of Credit Bank Counsel: Bond Counsel: $2,205,000 - Series A - $1,405,000 Tax-Exempt Refunding - Series B - $800,000 Taxable Variable Rate Demand Industria! Development Revenue Bonds 14 Years for Tax-ExempU20 Years for Taxable Port Authority of the City of Saint Paul Roger H. Greenberg To Se Determined U.S. Bank National Association Miller & Schroeder Financial, Inc. Piper Jaffray, fnc. FBS Investment Services, Inc. Piper Jaffrey, lnc. Winthrop & Weinstine Oppenheimer, Wolff & Donneliy Briggs and Morgan Leonard, Street & Deinard October 17, 1997 Page -2- BACKGROUND: �C� -1308' The Bo�rower. Bro-Tex Co., fnc. processes synthetic fibers for the automotive industry and manufactures and converts paper and cfoth wipers and is currentiy located at 800 Hampden Avenue, Saint Paul, in a facility originaiiy financed by the issuance ofi a tax-exempt Port Authorify conduit bond in 1984. ln 1996, the company acquired from Hampden Building Limited Partnership the bu+lding located on the ad}'acent parcel of land, to provide space for expansion. The Nampden Building had originally been financed by the issuance of a tax-exempt Port Authority conduit bond in 1984 which was refunded in 1990. This debt was assumed by Roger Greenberg as part of the acquisition. The company has now compieted their expansion, and has installed in its expanded space a new line of manufacturing equipment, which was financed with a $2,000,000 Port Authority conduit bond issue in April of this year. The Bands: The Bonds will be issued in the approximate principal amount of $2,205,000 and wiil bear interest at a variabie rate estabiished weekly by the Remarketing Agent. The maximum interest rate is 10% for the tax-exempt bond series and 18°lo for the taxable bond series. The Project: The proceeds of the Bonds will be loaned to the Borrower, and the $1,405,000 tax- exempt portion of this bond issue wiN be used to refund the Bonds previously issued by the Port Authority to finance the origina{ Bro-Tex facility and the Hampden Building. Tfie Borrower has represented that the owner of the prior bonds has approved this refunding. The $800,000 taxabie portion of this bond issue wili be used to reimburse the company for costs on ihe 37,000 square fooi expansion. The availability of tax-exempt financing for the refunding will enable Bro-Tex Co., Inc. to expand its present capacity. As a result, new jobs will also be created to support the revenue and production increases. Em�lo�ment {mpact: This project is important because it retains this company and its jobs in Saint Paul. Under the Port Authority's Workforce and Empioyment Agreement, Bro-Tex, Inc. befieves it will create 22 new jobs in the first two years of operations of its expanded facility, as a result of its increased capacity. Also, as a result of the consfructian of the new facility, Bro-7ex, 4nc. has estimated that there wiil be an annual payroll increase of over $400,000 per year when fully operational. October 17,1997 Page -3- Number of Jobs Cunent positions New positions within two years TOTAL 90 22 � Annuaf Waaes $2,0OO,OQ� 400.000 $2.400.000 The tetter of Credit Bank: The initial letter of credit will be provided by U.S. Bank Nationai Association. �stimated Sources and Uses of Funds: Sources of Funds: Bond Proceeds Estimated Borrower Funds Total Sources of Funds Uses of Funds: Refu�ding of 1984 Bond Issue Refunding of 1990 Sond Issue Reimburse Capital Expenditures for Expansion Estimated Costs of issuance Totai Uses of Funds SECURITY FOR THE BONDS: $2,205,00a 85.000 $2,290,000 $ 490,040 900,00� 800,000 100.000 $ 2,290,000 �1-1�� $` Conduit Financing The bonds will be conduit financing of the Authority and wiil not constitute or give rise to a{iabiiity of the Authority, the City of Saint Paui or the State of Minnesota or a charge against their generai credit or taxing powers. No bondholder wifl have the right to demand payment of the bonds out of any funds to be raised from taxation or trom any revenue sources other than those expressly pledged to payment of the bonds pursuant to the indenture. This includes the amounts drawn on the letter of credit and amounts payable by the borrower under the loan agreement. The Port Authority wi11 receive fees in the amount of 1/8th of a point ($2,756.25) at inception and 118th of a point on the outstanding balance, annually, for the life of fhe bonds. October 17,1997 Page -4- �17-130�' Loan AgreemenY Under the indenture, the Authoriry has pledged its interest in the loan agreement to the trustee to secure the bonds. The trustee is authorized fo exercise the rights of the Aufhority and fo enforce the obligations of the borrower under the loan agreement Let[er of Credit: Payment of the principal amount and purchase price of the bonds, and up to approximately 50 days interest thereon (measured at the 10% maximum rate for the tax-exempt series and 18% for the taxable series) wili be secured initialfy by the initiai letter of credit or, under cerfain circumstances a substitute letter of credit. The trustee is required to present a draft under the letter of credit to pay principa! and interest when due on the bonds. The bonds are offered primarily on the basis of the financial strength of the bank and not on the basis of the financial strength of the borrower. The letter of credit wifl have an initial term of one year, and will be renewable annually thereafter, uniess the bank provides at least 45 days notice that it wili not renew. If the letter of credit is not renewed or replaced, the bonds will be subject to mandatory tender, and the trustee +s instructed to draw on the letter of credit, before it expires, to purchase the bonds, which wou{d then remain outstanding and be he{d by the bank and possibly remarketed without a letter of credit with proper disclosure DISCLOSURE: Port Authority Commissioners, by S.E.C. rules, are obligated to disclose any risks or faets you may be aware of that would affect the probabi{ity of repayment of these bonds. RECOMMENDATION: Recommend approval of the above-referenced Resolution. PMK:jmo o�amk��axa.a� -s �'1-1 � 08' Resolution No. RESOLUTION OF THE PORT AUTHORI'f'Y f3F THE CITY OF SAINT AUL WHEREAS: 1. It has been proposed that the Port Authority of the City of Saint Pau{ {the "Port Authority") issue its Variable Rate Demand Industrial Deveiopment Revenue Refunding Bonds (Bro-Tex Project) 5eries 1997A (the °Series A Bonds") and its Taxable Variable Rate Demand Industrial Development Revenue Bonds SBro-Tex Project) Series 1997B Sthe "Series B Bonds" and together with the Series A Bonds, the "Bonds") in an aggregate principal amount not to exceed 52,205,000], and that the proceeds ofi such Bonds be loaned to Roger H. Greenberg, an individual resident of the State of Minnesota (the "Borrower") for the purposes of {a) refunding the Port Authority's 51,065,000 Industrial Deve{opment Revenue Refunding Bonds (Hampden Buiiding Project) (the "1990 Bonds"} and 5850,�00 Industrial Development Revenue Note ofi 1984 (Bro-Tex, Inc. Project) (the "1984 Note", and together with the 1990 Bonds, the "Prior Bonds"►, and {b) reimbursing the Borrower for capital costs incurred in connection with an expansion of the existing manufacturing facility owned and operated by Bro-Tex, fnc. in the City of Saint Paui, Minnesota (the "City") (the activities described in clauses (a) and (b) shall be collectively referred to herein as the "Project"). , 2. The above-described proposal has changed since August 26, 1997, the date the Port Authority gave its preliminary approval to the issuance of the Bonds, in that the Borrower has asked the Port Authority to additionally refund 1984 Note, thereby causing the total aggregate amount of the Bonds to increase from approximately 51,76�,000 to an amount not to exceed 52,205,000. 3. The Authority desires to facilitate the selective development of the City of Saint Paul and the metro east community, to retain and improve its tax base and to help it provide the range ofi services and empfoyment opportunities required by its population, and the Project will assist in achieving that objective by increasing the assessed valuation of the metro east community; helping to maintain a positive relationship between assessed valuation and debt; and enhancing the image and reputation of the metro east community. 4. The Project wiil result in additional employment opportunities in the City of Saint Paul and the metro east community. 5. The Authority has been advised by representatives of the Company that fong term conventional, commerciai financing to pay the capitai cost of the Project is available only on a limited basis and at such high costs of borrowing that the ]5888A3.01 �I� -43�� economic feasibility of the Project wouid be significantly reduced, and that it has been acting to date in anticipation that the Authority would favorably consider this financing proposal. 6. The Authority's Credit Committee and Board have previousfy adopted their Resolutions Nos. 26 and 3648, respectively, giving preliminary approval to the proposed issuance of revenue bonds. 7. The Bonds will be issued and secured by the terms ofi an Indentu�e of Trust (the "lndenture") between the Port Authority and in , Minnesota (the "Trustee") and will be payable primarily from draws made on an irrevocabie fetter of credit issued by U.S. Bank National Association (the "Credit Enhancer") pursuant to a Letter of Credit and Reimbursement Agreement to be dated as of November , 7 997 between the Borrower and the Credit Enhancer (the "Letter of Credit Agreement"). 8. The Borrower and the Port Authority will also enter into a Loan Agreement (the "Loan Agreement") in which the Borrower wil! agree to maintain the Letter of Credit and make all payments due either to the Credit Enhancer or on account of the Bonds. 9. The Bonds and the interest on the Bonds shall Be payable solely from the revenue pledged therefor and the Bonds shall not constitute a debt of the Port Authority within the meaning of any constitutional or statutory limitation of indebtedness, nor shall the Bonds constitute nor give rise to a pecuniary Iiability of the Port Authority or the City or a charge against their general credit or taxing powers and shall not constitute a charge, lien or encumbrance, lega! or equitabie, upon any property of the Port Authority or the City other than their interest in said Project. 10. it is intended that interest on the Series A Bonds be excluded from gross income of the holders thereof for federal i�come tax purposes. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMiSS10NERS OF THE PORT AUTHORITY OF THE CITY OF SAINT PAUL, AS FOLLOWS: 1. On the basis of information available to the Port Authority it appears, and the Port Authority hereby finds, that: the expansion of the manufacturing facility to be financed with the Series B Bonds consiitutes properties, used or usefiui in connection with one or more revenue producing enterprises engaged in any business within the meaning of Minnesota Statutes, Sections 469.152 to 469.165 (the "Act"), and that the Port Authority is authorized to issue revenue bonds to refund the Prior Bonds pursuant to the Act; the Project furthers the purposes stated in the Act; and it is in the best interests of the port district and the people of the City of Saint Paul and in furtherance of the general plan of development to assist the Borrower in financing the Project. 1588&l3,01 9�-i'�og� 2. For the purpose of financing the Project, and paying certain costs of issuance and other axpenses in connection with the issuance of the Sonds, tfie Port Authority hereby authorizes the issuance, safe and delivery of the Bonds in an aggregate principal amount not to exceed 52,205,OOQ, for the purposes set forth in the first whereas clause above. Each Series of Bonds shall be in such principal amounts as shall be determined by the President of the Port Authority and Bond Counsel, provided that the aggregate principal amount of Series A Bonds shalf not exceed � 1,405,000. The Bonds shall bear interest at such rates, shall be numbered, shall be dated, shal{ mature, shal{ be subject to redemption prior to maturity, and sha11 be in such form and have such other details and provisions as may be prescribed in the Indenture, suhstantially in the form now on tile in the offices of the Port Authority. 3. Neither the Bonds, nor the interest thereon, shall constitute an indebtedness of the Port Authority or the City within the meaning of any constitutional or statutory debt limitation; nor shall they constitute or give rise to a pecuniary liabifity of the City, the Port Authority or a charge against their general taxing powers and neither the fufl faith and credit nor the general taxing powers of the C+ty or the Port Authority is pledged to the payment of the Bonds or interest tfiereon. 4. Forms of A�thority for review delivery of the Bonds: the following documents have been submitted to the Port andlor approval in connection witfi the sale, issuance and a. the Bond Placement Agreement to be entered into between the Port Authority, the Borrower and Miller & Schroeder Financial, Inc., Piper Jaffray Inc. and U.S. Bancorp Investments, Inc. (coilectively, the °Placement Agent") ithe "Bond Placement Agreement"); b. the Indenture; c. the Loan Agreement dated as of November 1, 1997 to be entered into between the Port Authority and the Borrower; d. the Bonds; e: the Preliminary Official Statement to be used in marketing the Bonds (the "Officiai StatemenY'}; f. the Remarketing Agreement dated as of November 1, 1997 to be entered into by and between Piper Jaffray Inc. (the "Remarketing AgenY'} and the Borrower ithe "Remarketing Agreement"�; and g. the tetter of Credit Agreement, including a form of the Letter of Credit 1588843.01 9'1-13 08' (coilectively, the "Documents"). 5. It is hereby found, determined and declared that: a. The issuance and sale of the Bonds, the execution and delivery by the Port Authority of the Documents {to the extent applicable) and the performance of all covenants and agreements of the Port Authority contained in the Documents, and of aff other acts and things required under the Constitution and laws of the State of Minnesota to make the Documents and the Bonds valid and binding obligations of the Port Authority in accordance with their terms, are authorized by Minnesota Statutes, Sections 469.152 through 469.165, as amended (the "Act"); b. It is desirable that the Bonds be issued by the Port Authority upon the general terms set forth in the Documents, as applicable; c. Under the provisions of and as provided in the Documents, the Bonds are not to be payable from or a charge upon any funds other than the revenues pledged to the payment thereof; no holder of the Bonds shaii ever have the right to compel any exercise by the City or the Port Authority of its taxing powers to pay the Bonds or the interest or premium thereon, or to enforce payment thereot against any property of the City or the Port Authority except tfie interests of the Port Authority and the City which have been pledged to the Trustee under the Indenture; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City or the Port Author+ty except the interests of the Port Authority and the City which have been pledged to the Trustee under the Indenture; the Bonds shall each recite that they are issued without morai obligation on the part of the State or its political subdivisions, and that the Bonds, inciuding interest thereon, are payable sofely firom the revenues pledged to the payment thereof; and the Bonds shall not constitute a debt of the City or the Port Authority within the meaning of any constitutional or statutory limitation. 6. The forms of the Documents and exhibits thereto are approved substantiafly in the forms submitted and on file in the offices of Port Authority, with such subsequent changes as may be approved by Port Authority staff and Bond Counsel as contemplated by paragraph 8. The Chair and Secretary of the Port Authority, or such other officer as may be appropriate in the absence of either the Chair or Secretary, are hereby authorized and directed to execute the Documents {to the extent the Port Authority is a party thereto) in substantially the forms subm+tted, as modified pursuant to paragraph 8, and any other documents and certificates which in the opinion of Port Authority staff and Bond Counsei are necessary to the transaction herein described The execution of any instrument by the appropriate officer or officers of the Port Authority herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. The execution of any documents necessary for the transaction herein described by 1588843.01 °1�-130� individuals who were at the time of execution thereof the authorized officers of the Port Authority sha!( bind the Port Authority, notwithstanding that such individuals or any of them has ceased to hold such off+ce or offices prior to the authentication and delivery of the Bonds. Copies of all of the documents necessary to the transaction described shal{ be delivered, filed and recorded as provided herein and in the Indenture. 7. The President and other officers of the Port Authority are authorized and directed to prepare and furnish to the Piacement Agent and Bond Counsel certified copies of proceedings and records ofi the Port Authority relating to the issuance of the Bonds and other transactions herein contempiated, and sueh other affidavits and certificates as may be required to show the facts relating to the legality of the Bonds and the other transactions herein contemplated as such facts appear from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the Port Authority as to the truth of all statements contained therein. 8. The approval hereby given to the various Documents referred to above includes approvaf of such additional details therein as may be necessary and appropriate, and such modifications thereof, deietions therefrom and additions thereto as may be necessary and appropriate and approved by the Port Authority's President and Chief Financial Officer; and inctudes approval of, among other things: a, The establishment of the final principal amount of the Bonds and the interest rate to be borne thereby for the initial period; rovi that the maximum aggregate principai amount of the Series A Bonds shalf not exceed 51,405,000, and the maximum aggregate principal amount of the Series A Bonds and the Series B Bonds together shall not exceed �a2,205,000; and provided further that the maximum interest rate on the Series A Bonds shall not exceed 10% per an�um, and the maximum interest rate on the Series B Bonds shall not exceed 18% per annum; b. The establishment of the maturity schedule and call provisions to be applicable to the Bonds; and c. Such related instruments as may be required to satisfy the conditions of any purchaser of the Sonds. 9. The Port Authority hereby consents to the distribution of the Official Statement, as such Official Statement is fiinalized with the participation of Port Authority staffi and Bond Counsel. The proposal of the Placement Agent to place the Bonds upon the terms and conditions set forth in the Bond Placement Agreement is hereby found and determined to 6e reasonable and is hereby accepted. 10. The authority to approve, execute and deliver future amendments to financing documents entered into by the Port Authority in connection with the tssssas.at q� - ��oa' issuance of the Bonds and the other transactions herein contemplated, is hereby delegated to the President ofi the Port Authority, provided that: ia) such amendments do not require the consent ofi the holders of the Bonds; {b) such amendments do not materially adversely affect the interests of the Port Authority as the issuer of the Bonds; (c) such amendments do not contravene or violate any policy of the Port Authority; and {d) such amendments are acceptable in form and substance to Bond Counsel. The execution of any instrument by the President of the Port Authority shall be conciusive evidence of the approval of such instruments in accordance with the terms hereof. 11. No covenant, stipulation, ob{igation or agreement contained herein or in the Documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the Board of Commissioners of the Port Authority, or any officer, agent or employee of the Port Authority in that persons individual capacity, and neither the Board of Commissioners nor any officer executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. Adopted: October 28, 1997 PORT AUTHORITY OF THE CfTY OF SAINT PAUL By Its Chair ATTEST: By Its Secretary 1588&43.01 _ Council File ,# q� � j �(�� Green Sheet # `� `� ( RESOLUTION SAINT PA��"� '*'��_.,_ ' � ��_ Presented By Referred To Committee: Date WHEREAS: 1. The Port Authority of the City of Saint Paul {the "Authority") has given its approval to the issuance af up to 52,205,000 of its Variable Rate Demand Industrial Development Revenue Bonds (Bro-Tex Project) Series 1997A and Series 1997B (co{{ectively the "Bonds"}, for the purposes of (a) refunding both the Port Authority's 51,065,000 Industrial Development Revenue Refunding Bonds iFiampden Building Project� and the Port Authority's 5850,000 industrial Development Revenue Note of 1984 (Bro-Tex, inc. Projectl, and (b) reimbursing the Borrower for capital costs incurred in connection with an expansion of the existing manufacturing facility owned and operated by Bro-Tex Co., lnc. in the City of Saint Paul, Minnesota (the "City"); and 2. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue bonds authorized by the Authority shall be issued only with the consent of the City Council of the City of Saint Pauf, by resolution adopted in accordance with law; and 3. To meet the requirements of state law, the Port Authority has requested that the City Council gives its requisite approval to the issuance of the proposed Bonds by the Port Authority, subject to final approval of the details of said Bonds by the Port Authority. ` • q7-1308' NOW, THEREFORE, BE IT RESOLVED by the Council ofi the City of Saint Paul that, in accordance with Laws of Minnesota 1976, Chapter 234, the City Council hereby approves the issuance of the aforesaid Sonds by the Port Authority for the purposes described in the Port Authority resolution adopted Qctober 28, 1997, the exact details of which, including but not limited to, provisions relating to maturities, interest rates, discount, redemption, and the issuance of additional bonds are to be determined by the Port Authority, and the City Council hereby authorizes the issuance of any additional bonds (including refunding bonds) by the Port Authority found by the Port Authority to be necessary for carrying out the purposes for which the aforedescribed Bonds are issued. Adopted: October 29, 1997 3588843.0] Requeste Depamnent of: ��^� /� vG� ��l��.e'�L� � Adoption Certified by Council Secretarv � App� � Form Appr ved by City Attomey By�L'"^ � � °— �p- T7 Appr ved by 'ssion to�cil By: � Adopted by Council: Date �� _ aq \g9;� Saint Paul Port Authority Peter M. Klein , 1997 (CONSENT AGENT) I GREEN SHEET � DEPARTMENTOIRECTOR � CRY ATiORNEY FOfl . � BUDGET DIflECTOR ■ � MAYOR IOR ASSISTANi) N� �t� -f�og- _13116 — wmawa'r� —� CliY CAUNCII C17Y 0.ERK FW. & MGT. SERVICES �IR. ax exempt re or the refuni Bro-Tex facil: _al costs incu TOTAL # OF S PAGES (CLIP ALL LOCATION F SIGNATURE) �crioNr�QUesrEO:Ap roval of the issuance of an ag roximate $2,205,000 condui and conduit �axable bond issue to Ro er A. �reenber ; Bro-Tex Co. Inc ofbonds previously issued by the Por� Authority to �inance the origina and the Hampden Building, and for reimbursement to the company for cap in connection with a 37,000 Sq, Ft. expansion to the Bro-Tex £acility. RECOMMENDATIONS: ApprovB fA) or Reject (R) _ PLANNING COMMI5510N _ qVIL SERVICE COMMVSSION _C16COMMITTEE A Port Authoritv _ �, _ Bd. of Co�. _DISTRICTGOURT _ SUPPORTS WHICH COUNGIL OBJECTIYE? INITIATING PROBLEM, ISSUE, OPPORTUNITY (Wtw, PERSONAL SERVICE CONTRACTS MUST ANSWER THE FOLLOWING QUESTIONS: t. Has Nis OersonNirm ever worked under a contract for ihis department? YES NO 2. Has this personlEirm ever been a city employee? YES NO 3. Does this personifirtn possess a skiil not normally possessed by any curcent ctty employee? YES NO Explain all yes answers on separate sheet and attaeh to green sheet The refunding bond issue will enable Bro-Tex, Inc, to expand its present capacity. As a result, approximately 22 new �obs will be created in the first two years of its expanded facility. ��c��a ��''�"'1 �`i�i'a��3' None C� S 2 t� 3��7 he new jobs will not be created . AMOUNTOFTRANSACTION $ 2 2QS� OOO CaSVpEVENUE BUDGETED (CIRCLE ONE) YES NO Gonduit tax exempt refunding NGSOURCE and conduit taxable bond issue ACTIVITYNUMBER IAL IHFORMATION. (EXPLAIN) �e. 91-13ot� FAX (612) 223-5198 PORT AUTHORITY OF THE C(TY OF SAINt PAUL TOLI R2EE (8�) 328-8417 1900 LA(VDMARK TOWERS • 345 ST. PETER 5TREET • ST. PAUL MN 55102-1661 • PHONE (612) 224-5686 October 17, 1997 Ms. Pam Wheelock, Director Planning & Economic Development Department 1300 Gity Hall Annex 25 West Fourth Streef Saint Paul, Minnesota 55102 RE: $2,205,000 CONDUIT TAX EXEMPT REFUNDING AND CONDLlIT TAXABLE BOND ISSU ROGER H. GREENBERG - BRO-TEX CO., INC. Dear Ms.� ck`:��.� / We submit for your review and referraf to the office of the Mayor, City Council, and City Attorney's office, details pertaining to the issuance of a conduit tax-exempt refunding and conduit taxable bond issue in the approximate amount of $2,205,000. The tax exempt portion of this bond issue wi11 be used to refund the bonds previousfy issued by the Port Authority to finance the originaf Bro-Tex facility and the Hampden Building, and the taxable portion of this bond issue will be used to reimburse the company for capital costs incurred in connection with a 37,000 Sq. Ft. expansion to the Bro-Tex facility. The availability of tax- exempt financing for the refunding will enable Bro-Tex Co., Inc. to expand its present capacity. In addition to the staff memorandum, we are attaching a draft copy of the proposed City Council Resolution and a copy of the Resolution authorizing the sale of the revenue bond issue in the amount of $2,205,000 that wii{ be considered by the Port Authority's Board on October 28, 1997. City Council action will be required after the Port Authority's Board meeting of Oetober 28, 1997. Your expeditious handling of this matter wiN be appreciated. Sincerely, �� Kenneth R. Johnson President KRJ:s}s Attachment cc: Mayor Coleman 9:PmMbrot�W+.tloc SAINT PAUL PoRT AUTHORITY � .•� . � TO: CREDIT COMMiTTEE DATE: Oct. 17, 1997 {October 21, 1997 ftegular Credit Committee Meeting) FROM: Peter M. Klein �L'� torrie J. Louder Kenneth R. Johnson SUBJECT: ROGER H. GREENSERG - SRO-TEX CO., INC. AUTHORIZATION FOR AN APPROXIMATE $2,205,000 CONDUtT TAX EXEMPT REFUNDING AND CONDUlT TAXABLE BOND iSSUE °I�-13otr Change from Preliminary Resolution In August, the Board of Commissioners preliminarify approved the issuance of $1,760,000 of conduit bonds for Mr. Greenberg. The increase in the amount of bonds from $1,760,000 to $2,205,000 is due to Mr. Greenberg's request to also refinance a 1984 bond issue, which remains outstanding in the amount of $490,000. PMK:jmo SAINT PAUL l'•' ' �� .•� . � TO: CREDIT COMM(TTEE DAT'E: Qct. 17, 1997 (October 21, 1997 Regular Credit Commiftee Meeting) FROM: Peter M. Klein l��'` lorrie J. Lauder Kenneth R. Johnson ° I � -130�' SUBJEC"T: ROGER H. GREENBERG - SRO-TEX CO., fNC. AUTHORIZATION FOR AN APPROXIMATE $2,205,000 CONDUIT TAX EXEMPT REFUNDING AND CONDUIT TAXABLE BOND ISSUE ACTfON REQUESTED: Approvai of final resofution authorizing the issuance of an approximate $2,205,000 conduit bond issue to Roger H. Greenberg. PROJECT SUMMARY: Estimated Amount:: Type: Term: Issuer: Borrower: Trustee: Letter of Credit Bank: Placement Agents: Remarketing Agent: Borrower's Counsel: Placement Agents' Counsel: Letter of Credit Bank Counsel: Bond Counsel: $2,205,000 - Series A - $1,405,000 Tax-Exempt Refunding - Series B - $800,000 Taxable Variable Rate Demand Industria! Development Revenue Bonds 14 Years for Tax-ExempU20 Years for Taxable Port Authority of the City of Saint Paul Roger H. Greenberg To Se Determined U.S. Bank National Association Miller & Schroeder Financial, Inc. Piper Jaffray, fnc. FBS Investment Services, Inc. Piper Jaffrey, lnc. Winthrop & Weinstine Oppenheimer, Wolff & Donneliy Briggs and Morgan Leonard, Street & Deinard October 17, 1997 Page -2- BACKGROUND: �C� -1308' The Bo�rower. Bro-Tex Co., fnc. processes synthetic fibers for the automotive industry and manufactures and converts paper and cfoth wipers and is currentiy located at 800 Hampden Avenue, Saint Paul, in a facility originaiiy financed by the issuance ofi a tax-exempt Port Authorify conduit bond in 1984. ln 1996, the company acquired from Hampden Building Limited Partnership the bu+lding located on the ad}'acent parcel of land, to provide space for expansion. The Nampden Building had originally been financed by the issuance of a tax-exempt Port Authority conduit bond in 1984 which was refunded in 1990. This debt was assumed by Roger Greenberg as part of the acquisition. The company has now compieted their expansion, and has installed in its expanded space a new line of manufacturing equipment, which was financed with a $2,000,000 Port Authority conduit bond issue in April of this year. The Bands: The Bonds will be issued in the approximate principal amount of $2,205,000 and wiil bear interest at a variabie rate estabiished weekly by the Remarketing Agent. The maximum interest rate is 10% for the tax-exempt bond series and 18°lo for the taxable bond series. The Project: The proceeds of the Bonds will be loaned to the Borrower, and the $1,405,000 tax- exempt portion of this bond issue wiN be used to refund the Bonds previously issued by the Port Authority to finance the origina{ Bro-Tex facility and the Hampden Building. Tfie Borrower has represented that the owner of the prior bonds has approved this refunding. The $800,000 taxabie portion of this bond issue wili be used to reimburse the company for costs on ihe 37,000 square fooi expansion. The availability of tax-exempt financing for the refunding will enable Bro-Tex Co., Inc. to expand its present capacity. As a result, new jobs will also be created to support the revenue and production increases. Em�lo�ment {mpact: This project is important because it retains this company and its jobs in Saint Paul. Under the Port Authority's Workforce and Empioyment Agreement, Bro-Tex, Inc. befieves it will create 22 new jobs in the first two years of operations of its expanded facility, as a result of its increased capacity. Also, as a result of the consfructian of the new facility, Bro-7ex, 4nc. has estimated that there wiil be an annual payroll increase of over $400,000 per year when fully operational. October 17,1997 Page -3- Number of Jobs Cunent positions New positions within two years TOTAL 90 22 � Annuaf Waaes $2,0OO,OQ� 400.000 $2.400.000 The tetter of Credit Bank: The initial letter of credit will be provided by U.S. Bank Nationai Association. �stimated Sources and Uses of Funds: Sources of Funds: Bond Proceeds Estimated Borrower Funds Total Sources of Funds Uses of Funds: Refu�ding of 1984 Bond Issue Refunding of 1990 Sond Issue Reimburse Capital Expenditures for Expansion Estimated Costs of issuance Totai Uses of Funds SECURITY FOR THE BONDS: $2,205,00a 85.000 $2,290,000 $ 490,040 900,00� 800,000 100.000 $ 2,290,000 �1-1�� $` Conduit Financing The bonds will be conduit financing of the Authority and wiil not constitute or give rise to a{iabiiity of the Authority, the City of Saint Paui or the State of Minnesota or a charge against their generai credit or taxing powers. No bondholder wifl have the right to demand payment of the bonds out of any funds to be raised from taxation or trom any revenue sources other than those expressly pledged to payment of the bonds pursuant to the indenture. This includes the amounts drawn on the letter of credit and amounts payable by the borrower under the loan agreement. The Port Authority wi11 receive fees in the amount of 1/8th of a point ($2,756.25) at inception and 118th of a point on the outstanding balance, annually, for the life of fhe bonds. October 17,1997 Page -4- �17-130�' Loan AgreemenY Under the indenture, the Authoriry has pledged its interest in the loan agreement to the trustee to secure the bonds. The trustee is authorized fo exercise the rights of the Aufhority and fo enforce the obligations of the borrower under the loan agreement Let[er of Credit: Payment of the principal amount and purchase price of the bonds, and up to approximately 50 days interest thereon (measured at the 10% maximum rate for the tax-exempt series and 18% for the taxable series) wili be secured initialfy by the initiai letter of credit or, under cerfain circumstances a substitute letter of credit. The trustee is required to present a draft under the letter of credit to pay principa! and interest when due on the bonds. The bonds are offered primarily on the basis of the financial strength of the bank and not on the basis of the financial strength of the borrower. The letter of credit wifl have an initial term of one year, and will be renewable annually thereafter, uniess the bank provides at least 45 days notice that it wili not renew. If the letter of credit is not renewed or replaced, the bonds will be subject to mandatory tender, and the trustee +s instructed to draw on the letter of credit, before it expires, to purchase the bonds, which wou{d then remain outstanding and be he{d by the bank and possibly remarketed without a letter of credit with proper disclosure DISCLOSURE: Port Authority Commissioners, by S.E.C. rules, are obligated to disclose any risks or faets you may be aware of that would affect the probabi{ity of repayment of these bonds. RECOMMENDATION: Recommend approval of the above-referenced Resolution. PMK:jmo o�amk��axa.a� -s �'1-1 � 08' Resolution No. RESOLUTION OF THE PORT AUTHORI'f'Y f3F THE CITY OF SAINT AUL WHEREAS: 1. It has been proposed that the Port Authority of the City of Saint Pau{ {the "Port Authority") issue its Variable Rate Demand Industrial Deveiopment Revenue Refunding Bonds (Bro-Tex Project) 5eries 1997A (the °Series A Bonds") and its Taxable Variable Rate Demand Industrial Development Revenue Bonds SBro-Tex Project) Series 1997B Sthe "Series B Bonds" and together with the Series A Bonds, the "Bonds") in an aggregate principal amount not to exceed 52,205,000], and that the proceeds ofi such Bonds be loaned to Roger H. Greenberg, an individual resident of the State of Minnesota (the "Borrower") for the purposes of {a) refunding the Port Authority's 51,065,000 Industrial Deve{opment Revenue Refunding Bonds (Hampden Buiiding Project) (the "1990 Bonds"} and 5850,�00 Industrial Development Revenue Note ofi 1984 (Bro-Tex, Inc. Project) (the "1984 Note", and together with the 1990 Bonds, the "Prior Bonds"►, and {b) reimbursing the Borrower for capital costs incurred in connection with an expansion of the existing manufacturing facility owned and operated by Bro-Tex, fnc. in the City of Saint Paui, Minnesota (the "City") (the activities described in clauses (a) and (b) shall be collectively referred to herein as the "Project"). , 2. The above-described proposal has changed since August 26, 1997, the date the Port Authority gave its preliminary approval to the issuance of the Bonds, in that the Borrower has asked the Port Authority to additionally refund 1984 Note, thereby causing the total aggregate amount of the Bonds to increase from approximately 51,76�,000 to an amount not to exceed 52,205,000. 3. The Authority desires to facilitate the selective development of the City of Saint Paul and the metro east community, to retain and improve its tax base and to help it provide the range ofi services and empfoyment opportunities required by its population, and the Project will assist in achieving that objective by increasing the assessed valuation of the metro east community; helping to maintain a positive relationship between assessed valuation and debt; and enhancing the image and reputation of the metro east community. 4. The Project wiil result in additional employment opportunities in the City of Saint Paul and the metro east community. 5. The Authority has been advised by representatives of the Company that fong term conventional, commerciai financing to pay the capitai cost of the Project is available only on a limited basis and at such high costs of borrowing that the ]5888A3.01 �I� -43�� economic feasibility of the Project wouid be significantly reduced, and that it has been acting to date in anticipation that the Authority would favorably consider this financing proposal. 6. The Authority's Credit Committee and Board have previousfy adopted their Resolutions Nos. 26 and 3648, respectively, giving preliminary approval to the proposed issuance of revenue bonds. 7. The Bonds will be issued and secured by the terms ofi an Indentu�e of Trust (the "lndenture") between the Port Authority and in , Minnesota (the "Trustee") and will be payable primarily from draws made on an irrevocabie fetter of credit issued by U.S. Bank National Association (the "Credit Enhancer") pursuant to a Letter of Credit and Reimbursement Agreement to be dated as of November , 7 997 between the Borrower and the Credit Enhancer (the "Letter of Credit Agreement"). 8. The Borrower and the Port Authority will also enter into a Loan Agreement (the "Loan Agreement") in which the Borrower wil! agree to maintain the Letter of Credit and make all payments due either to the Credit Enhancer or on account of the Bonds. 9. The Bonds and the interest on the Bonds shall Be payable solely from the revenue pledged therefor and the Bonds shall not constitute a debt of the Port Authority within the meaning of any constitutional or statutory limitation of indebtedness, nor shall the Bonds constitute nor give rise to a pecuniary Iiability of the Port Authority or the City or a charge against their general credit or taxing powers and shall not constitute a charge, lien or encumbrance, lega! or equitabie, upon any property of the Port Authority or the City other than their interest in said Project. 10. it is intended that interest on the Series A Bonds be excluded from gross income of the holders thereof for federal i�come tax purposes. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMiSS10NERS OF THE PORT AUTHORITY OF THE CITY OF SAINT PAUL, AS FOLLOWS: 1. On the basis of information available to the Port Authority it appears, and the Port Authority hereby finds, that: the expansion of the manufacturing facility to be financed with the Series B Bonds consiitutes properties, used or usefiui in connection with one or more revenue producing enterprises engaged in any business within the meaning of Minnesota Statutes, Sections 469.152 to 469.165 (the "Act"), and that the Port Authority is authorized to issue revenue bonds to refund the Prior Bonds pursuant to the Act; the Project furthers the purposes stated in the Act; and it is in the best interests of the port district and the people of the City of Saint Paul and in furtherance of the general plan of development to assist the Borrower in financing the Project. 1588&l3,01 9�-i'�og� 2. For the purpose of financing the Project, and paying certain costs of issuance and other axpenses in connection with the issuance of the Sonds, tfie Port Authority hereby authorizes the issuance, safe and delivery of the Bonds in an aggregate principal amount not to exceed 52,205,OOQ, for the purposes set forth in the first whereas clause above. Each Series of Bonds shall be in such principal amounts as shall be determined by the President of the Port Authority and Bond Counsel, provided that the aggregate principal amount of Series A Bonds shalf not exceed � 1,405,000. The Bonds shall bear interest at such rates, shall be numbered, shall be dated, shal{ mature, shal{ be subject to redemption prior to maturity, and sha11 be in such form and have such other details and provisions as may be prescribed in the Indenture, suhstantially in the form now on tile in the offices of the Port Authority. 3. Neither the Bonds, nor the interest thereon, shall constitute an indebtedness of the Port Authority or the City within the meaning of any constitutional or statutory debt limitation; nor shall they constitute or give rise to a pecuniary liabifity of the City, the Port Authority or a charge against their general taxing powers and neither the fufl faith and credit nor the general taxing powers of the C+ty or the Port Authority is pledged to the payment of the Bonds or interest tfiereon. 4. Forms of A�thority for review delivery of the Bonds: the following documents have been submitted to the Port andlor approval in connection witfi the sale, issuance and a. the Bond Placement Agreement to be entered into between the Port Authority, the Borrower and Miller & Schroeder Financial, Inc., Piper Jaffray Inc. and U.S. Bancorp Investments, Inc. (coilectively, the °Placement Agent") ithe "Bond Placement Agreement"); b. the Indenture; c. the Loan Agreement dated as of November 1, 1997 to be entered into between the Port Authority and the Borrower; d. the Bonds; e: the Preliminary Official Statement to be used in marketing the Bonds (the "Officiai StatemenY'}; f. the Remarketing Agreement dated as of November 1, 1997 to be entered into by and between Piper Jaffray Inc. (the "Remarketing AgenY'} and the Borrower ithe "Remarketing Agreement"�; and g. the tetter of Credit Agreement, including a form of the Letter of Credit 1588843.01 9'1-13 08' (coilectively, the "Documents"). 5. It is hereby found, determined and declared that: a. The issuance and sale of the Bonds, the execution and delivery by the Port Authority of the Documents {to the extent applicable) and the performance of all covenants and agreements of the Port Authority contained in the Documents, and of aff other acts and things required under the Constitution and laws of the State of Minnesota to make the Documents and the Bonds valid and binding obligations of the Port Authority in accordance with their terms, are authorized by Minnesota Statutes, Sections 469.152 through 469.165, as amended (the "Act"); b. It is desirable that the Bonds be issued by the Port Authority upon the general terms set forth in the Documents, as applicable; c. Under the provisions of and as provided in the Documents, the Bonds are not to be payable from or a charge upon any funds other than the revenues pledged to the payment thereof; no holder of the Bonds shaii ever have the right to compel any exercise by the City or the Port Authority of its taxing powers to pay the Bonds or the interest or premium thereon, or to enforce payment thereot against any property of the City or the Port Authority except tfie interests of the Port Authority and the City which have been pledged to the Trustee under the Indenture; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City or the Port Author+ty except the interests of the Port Authority and the City which have been pledged to the Trustee under the Indenture; the Bonds shall each recite that they are issued without morai obligation on the part of the State or its political subdivisions, and that the Bonds, inciuding interest thereon, are payable sofely firom the revenues pledged to the payment thereof; and the Bonds shall not constitute a debt of the City or the Port Authority within the meaning of any constitutional or statutory limitation. 6. The forms of the Documents and exhibits thereto are approved substantiafly in the forms submitted and on file in the offices of Port Authority, with such subsequent changes as may be approved by Port Authority staff and Bond Counsel as contemplated by paragraph 8. The Chair and Secretary of the Port Authority, or such other officer as may be appropriate in the absence of either the Chair or Secretary, are hereby authorized and directed to execute the Documents {to the extent the Port Authority is a party thereto) in substantially the forms subm+tted, as modified pursuant to paragraph 8, and any other documents and certificates which in the opinion of Port Authority staff and Bond Counsei are necessary to the transaction herein described The execution of any instrument by the appropriate officer or officers of the Port Authority herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. The execution of any documents necessary for the transaction herein described by 1588843.01 °1�-130� individuals who were at the time of execution thereof the authorized officers of the Port Authority sha!( bind the Port Authority, notwithstanding that such individuals or any of them has ceased to hold such off+ce or offices prior to the authentication and delivery of the Bonds. Copies of all of the documents necessary to the transaction described shal{ be delivered, filed and recorded as provided herein and in the Indenture. 7. The President and other officers of the Port Authority are authorized and directed to prepare and furnish to the Piacement Agent and Bond Counsel certified copies of proceedings and records ofi the Port Authority relating to the issuance of the Bonds and other transactions herein contempiated, and sueh other affidavits and certificates as may be required to show the facts relating to the legality of the Bonds and the other transactions herein contemplated as such facts appear from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the Port Authority as to the truth of all statements contained therein. 8. The approval hereby given to the various Documents referred to above includes approvaf of such additional details therein as may be necessary and appropriate, and such modifications thereof, deietions therefrom and additions thereto as may be necessary and appropriate and approved by the Port Authority's President and Chief Financial Officer; and inctudes approval of, among other things: a, The establishment of the final principal amount of the Bonds and the interest rate to be borne thereby for the initial period; rovi that the maximum aggregate principai amount of the Series A Bonds shalf not exceed 51,405,000, and the maximum aggregate principal amount of the Series A Bonds and the Series B Bonds together shall not exceed �a2,205,000; and provided further that the maximum interest rate on the Series A Bonds shall not exceed 10% per an�um, and the maximum interest rate on the Series B Bonds shall not exceed 18% per annum; b. The establishment of the maturity schedule and call provisions to be applicable to the Bonds; and c. Such related instruments as may be required to satisfy the conditions of any purchaser of the Sonds. 9. The Port Authority hereby consents to the distribution of the Official Statement, as such Official Statement is fiinalized with the participation of Port Authority staffi and Bond Counsel. The proposal of the Placement Agent to place the Bonds upon the terms and conditions set forth in the Bond Placement Agreement is hereby found and determined to 6e reasonable and is hereby accepted. 10. The authority to approve, execute and deliver future amendments to financing documents entered into by the Port Authority in connection with the tssssas.at q� - ��oa' issuance of the Bonds and the other transactions herein contemplated, is hereby delegated to the President ofi the Port Authority, provided that: ia) such amendments do not require the consent ofi the holders of the Bonds; {b) such amendments do not materially adversely affect the interests of the Port Authority as the issuer of the Bonds; (c) such amendments do not contravene or violate any policy of the Port Authority; and {d) such amendments are acceptable in form and substance to Bond Counsel. The execution of any instrument by the President of the Port Authority shall be conciusive evidence of the approval of such instruments in accordance with the terms hereof. 11. No covenant, stipulation, ob{igation or agreement contained herein or in the Documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the Board of Commissioners of the Port Authority, or any officer, agent or employee of the Port Authority in that persons individual capacity, and neither the Board of Commissioners nor any officer executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. Adopted: October 28, 1997 PORT AUTHORITY OF THE CfTY OF SAINT PAUL By Its Chair ATTEST: By Its Secretary 1588&43.01